Some senior citizens more vulnerable to fraud than others, study says

A collaborative study by researchers at Wayne State University and the Illinois Institute of Technology shows that psychological challenges like depression make some senior citizens much more vulnerable than others.

The combination of high depression and low social-status fulfillment was associated with a 226 percent increase in fraud prevalence in this population. This supports our theory that depressive symptoms and lack of social-needs fulfillment have an effect on fraud prediction and serves as a reminder to clinical gerontologists how psychological vulnerability can affect older adults' lives in a variety of ways.—Peter A. Lichtenberg

DETROIT — Scammers have long used telemarketing and door-to-door tactics to push fake home repairs, check scams, identity theft and other frauds on senior citizens. Now a collaborative study by researchers at Wayne State University and the Illinois Institute of Technology shows that psychological challenges like depression make some senior citizens much more vulnerable than others.

Those bent on financial exploitation apparently already know it. But it provides an opportunity for gerontologists and other clinicians, as well as concerned family members, to assess, intervene and perhaps prevent some of the fraud.

Fraud prevalence was three times higher among those who were most depressed and felt less connected and satisfied socially. Feeling lonely, disconnected or ignored made people more likely to respond to the friendliness and "caring" exhibited by scammers. While they are not necessarily targeted more, they respond more, said Peter A. Lichtenberg, professor of psychology and director of Wayne State's Institute of Gerontology, who led the study.

"There's a real social well-being component to fraud in the research literature," said Lichtenberg. Scammers, even the ones doing quick hits, typically form a bond and then exploit it, he said.

The research is published in the journal Clinical Gerontology. A release said it is the first to include prospective predictors of older adults victimized by financial fraud, as well as the first to look at a population's exploitation in terms of their psychological vulnerability. Lichtenberg said they were not looking at break-ins or robberies, but rather the type of frauds where victims hand over resources or information.

Big bucks

The National Association of Area Agencies on Aging said financial exploitation of older Americans is increasing, a trend likely to grow as Baby Boomers age. Already, it costs senior citizens about $3 billion a year.

The researchers looked at 4,440 participants in a Health and Retirement substudy called the 2008 Leave Behind Questionnaire. They found those who are most depressed are also the most taken by fraud, a wake-up call for professionals to be "aware of their psychologically vulnerable clients' heightened exposure to financial fraud."

They narrowly defined psychological vulnerability for this research, counting only those in the top 10 percent reporting depression and also reporting that they felt they were not treated with respect, but had suffered a loss of social status, compared to others their age in their general circumstance.

"They were isolated, lonely, lacking initiative and pleasure from the depression side and feeling like outsiders socially," Lichtenberg said. The difference in how many fell prey to fraud was "huge" — 14 percent compared to 4 percent of their not-depressed or not socially-isolated peers.

"One of the most significant findings of our study was with the most psychologically vulnerable population," he said. "The combination of high depression and low social-status fulfillment was associated with a 226 percent increase in fraud prevalence in this population. This supports our theory that depressive symptoms and lack of social-needs fulfillment have an effect on fraud prediction and serves as a reminder to clinical gerontologists how psychological vulnerability can affect older adults' lives in a variety of ways."

Those who felt less happy with their financial situation were also more likely to be taken, he noted, lured perhaps by the promise of savings or the chance to make some money.

People with conditions like Alzheimer's disease are also vulnerable, but were not included in this study because they lack capacity to answer the survey, Lichtenberg said.

Previous research

Other studies have documented the challenges faced by a frail or mentally challenged population in terms of handling money. A year ago, researchers in the United Kingdom introduced a tool to help those who work with the elderly determine if someone is being exploited financially. The UK Research Councils' New Dynamics of Ageing program (NDA) set out to see how professionals who are expected to help the elderly make decisions about whether abuse has occurred. It's a difficult task.

"First you have to notice that something is wrong," the researchers said, "then you have to decide whether it is abuse and this is clearly not straightforward. You need to make the decision whether to do something or not and if you do decide to intervene, you need the appropriate skills. Things could go wrong at any one of these points."

In that study, the researchers looked at the responses of healthcare workers, social care workers and bankers, the latter because of the large number of money scams. They identified two factors that had a "significant influence" on whether abuse would occur: the older person's mental capacity and the nature of the financial problem.

Lichtenberg's team is also developing tools to improve decision-making.

It's important, he said, for those who deal with senior citizens to recognize that financial health is important along with physical and mental health. He suggested that older adults "always get someone else's viewpoint" when an "opportunity" comes up that might be fraudulent. For example, the senior citizen's bank staff could be helpful to avoid exploitation, and more banks are training staff for that, he added.